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The impact of liberalization on European airline strategies and operations

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  • Doganis, Rigas

Abstract

The paper summarizes the economic arguments in favour of regulation. It goes on to analyse the operational and strategic developments among European airlines in response to regulatory liberalization. Four kinds of response are identified: a search for size and market dominance; efforts to reduce operating costs; the use of new market- ing tools; and the introduction of new operating practices. Despite expectations no new entrant airlines have emerged to challenge the established European majors. On the contrary, the European airline industry is increasingly concentrated. It does not manifest the economic characteristics of a competitive industry and is becoming increasingly oligopolistic. The key issue is whether, after a period of market instability, the remaining European airlines will collude or compete on intra-European services.

Suggested Citation

  • Doganis, Rigas, 1994. "The impact of liberalization on European airline strategies and operations," Journal of Air Transport Management, Elsevier, vol. 1(1), pages 15-25.
    • Handle: RePEc:eee:jaitra:v:1:y:1994:i:1:p:15-25
    DOI: 10.1016/0969-6997(94)90027-2
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    References listed on IDEAS

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    1. David Banister & Kenneth Button (ed.), 1991. "Transport in a Free Market Economy," Palgrave Macmillan Books, Palgrave Macmillan, number 978-1-349-11439-9.
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    Cited by:

    1. Ruiz-Moreno, Felipe & Mas-Ruiz, Francisco J. & Sancho-Esper, Franco M., 2021. "Strategic groups and product differentiation: Evidence from the Spanish airline market deregulation," Research in Transportation Economics, Elsevier, vol. 90(C).
    2. Weber, Mathieu & Dinwoodie, John, 2000. "Fifth freedoms and airline alliances. The role of fifth freedom traffic in an understanding of airline alliances," Journal of Air Transport Management, Elsevier, vol. 6(1), pages 51-60.
    3. Youdi Schipper & Piet Rietveld, 1997. "Economic and Environmental Effects of Airline Deregulation," Tinbergen Institute Discussion Papers 97-031/3, Tinbergen Institute.
    4. Perry, Allen, 1994. "The changing face of flying to the sun," Journal of Air Transport Management, Elsevier, vol. 1(4), pages 251-254.
    5. Goel, A., 2003. "Strategic Alliances in the Global Airline Industry," IIMA Working Papers WP2003-01-02, Indian Institute of Management Ahmedabad, Research and Publication Department.
    6. Budd, Lucy & Francis, Graham & Humphreys, Ian & Ison, Stephen, 2014. "Grounded: Characterising the market exit of European low cost airlines," Journal of Air Transport Management, Elsevier, vol. 34(C), pages 78-85.
    7. Budd, Lucy & Graham, Brian, 2009. "Unintended trajectories: liberalization and the geographies of private business flight," Journal of Transport Geography, Elsevier, vol. 17(4), pages 285-292.
    8. Aisling J. Reynolds-Feighan & Joe Durkan, 1997. "The impact of air transport on Ireland's export performance: final report: a study submitted to the Institute of International Trade of Ireland," Open Access publications 10197/114, School of Economics, University College Dublin.
    9. Burghouwt, Guillaume & de Wit, Jaap G., 2015. "In the wake of liberalisation: long-term developments in the EU air transport market," Transport Policy, Elsevier, vol. 43(C), pages 104-113.
    10. de Neufville, Richard, 1995. "Management of multi-airport systems," Journal of Air Transport Management, Elsevier, vol. 2(2), pages 99-110.

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